Trump’s Capitalism Goes on Trial—Part 2

In a single week in March 2019, Americans were treated to an unprecedented college admission bribery scandal, the lenient sentencing of Trump’s campaign manager on tax evasion, and Republican plans to cut the pensions of thousands of federal employees, accompanied by proposed decreases in Medicare and Medicaid budgets.

These sad events touched the power centers of American society: the benefits of wealth and privilege, a tilted judicial system, and how fostering retirement insecurity for millions of workers further destabilizes the middle class. All these crimes are happening in the wealthiest and most industrialized nation in world history.

The events of this week were a flagrant showcase of abuses. On display were the excesses of unregulated, monopoly capitalism that produced a society vividly skewed to the wealthy and politically favored, and those who can throw sand in the eyes of justice.

As noted in an earlier article on a similar topic on this site, Americans have an odd fascination with wealth. Most are not sure how vast amounts of money are accumulated and when it happens to someone, it generates a mysterious fascination about how much luck, personal connections or esoteric knowledge could be bestowed on one person and not another.

When people see others with vast wealth, it can also raise some serious introspection. Why them and not me? What did I do wrong? Or, is there something they know that I don’t?

And in the current world, people can ask how did that family’s child get admitted to that top school when mine did not? These questions have a life of their own since students share their college testing scores and grades. By social osmosis, classmates know how they stand in relation to one another.

Jared Kushner’s father gave Harvard $2.5 million donation at about the same time his son was admitted to that school. Maybe it was a coincidence. Similarly, Donald Trump Jr. was admitted to the University of Pennsylvania after his father gave at least $1.5 million to the college.

These may be coincidences. But, as they say in the intelligence community, coincidence take a lot of planning. Trump himself was admitted to the University of Pennsylvania, never graduated and then had his grades, and later his tax returns, sealed from public scrutiny.

Moving back to the present, we see that not much has changed. Among the 50 people cited in the college admissions scandal are Douglas Hodge, former chief executive of Pimco, one of the world’s biggest bond fund managers. In 2013, Hodge’s annual salary was $45 million. Also charged was William E. McGlashan Jr., a senior executive at TPG, one of the world’s biggest private equity firms. McGlashan is a graduate of Yale and Stanford. And since this is about money and privilege, the scheme was also tax deductible since the creator of the scam funneled the payments through his charity.

So while this scandal is one everyone can relate to, it also buttresses the belief that the system is very broken.

Capitalism on Trial

News of public corruption in governments worldwide, combined with the unprecedented wealth gap, burdensome tuition loans and constant pressures of consumerism have soured many people on the current economic system.

This explains the results of surveys cited in the publication Foreign Policy, which found:
“According to an April 2016 Harvard University poll, support for capitalism is at a historic low. 51 percent of Americans in this age cohort reject it, while 42 percent support it. 33 percent say they support socialism. The Harvard poll echoes a 2012 Pew survey, in which 46 percent of 18- to 29-year-olds had a positive view of capitalism, and 47 percent a negative one. While older generations had a slightly more positive take on capitalism — topping out at 52 percent for the oldest cohort, citizens over 65 — youth had a markedly different take on socialism. 49 percent viewed it positively, compared to just 13 percent of those 65 or older.”

So how will the Mueller investigation affect these survey results?

We’ll certainly wait, but the bottom line is that the Mueller investigation will not only be an indictment of Trump and his family, but of any entire economic system. No wonder people are looking for new economic alternatives. If this version of unregulated capitalism produced Trump, and the unearned status and privilege of him and his family, what hope is there for the average citizen, without access to the privilege money can buy?

The inequalities caused by the two ways of life—excess privilege and restricted access–do not result in an economically, judicial or socially just society. There will be a large social and political cost to close this gap. The process may just be beginning.

Chuck Epstein

Chuck Epstein has managed marketing communications and public relations departments for major global financial institutions and participated in the launch of industry-changing financial products. He also has written by-lined articles for over 50 publications, five books and served as editor and publisher of nation’s first newsletter on the topic of using the PC for personal investing and trading. (“Investing Online, 1994-1999). He also is a marketing consultant, writer and speaker on topics related to investor protection and opportunities in the very dynamic cannabis industry.

He has held senior-level marketing, PR and communications positions at the New York Futures Exchange, Chicago Mercantile Exchange, Lind-Waldock, Zacks Investment Research, Russell Investments and Principal Financial.

He has won national awards from the Mutual Fund Education Alliance (MFEA) and his web site, www.mutualfundreform.com, was named best small blog in 2009 by the Society of American Business Editors and Writers (SABEW).

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